Steel and aluminium exporters in India, particularly small ancillary units, are facing severe challenges due to escalating US tariffs initiated by President Trump. The initial 25 percent tariffs were soon doubled to 50 percent, resulting in clients delaying orders and payments. This has caused a significant cancellation of orders, with reports indicating nearly 30 percent cancellations. Furthermore, competition from cheaper Chinese products has hampered domestic demand. Future growth for Indian exporters depends on successful negotiations for lower tariffs compared to international competitors, despite significant exports reaching $4.56 billion last year.
Garodia noted that as a result of the tariffs, clients have slowed picking up their orders, delaying payments by a month on average, while business in general has slowed as customers adopted a wait-and-watch policy.
When Trump announced that he was doubling tariffs on steel and aluminium to 50 percent from June 4, it was like a nail in a coffin, Garodia said, as nearly 30 percent of orders were cancelled.
Demand in the domestic market has also been low because of competition from cheaper Chinese products, he said, adding their future depends on India negotiating a lower tariff for its exports to the US than its competitors.
Last year, India exported $4.56bn worth of iron, steel and aluminium products to the US.
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